Online Business Group Publishes a Top Ten List of iAWFUL Internet Laws

By Kevin Fayle on
June 11, 2009 12:31 PM

The days of the lawless internet are long gone, and we all have cyberlaws that we wish didn't exist or would like to see changed. Now, one group has come out swinging against internet laws in the works that it sees as counter to the interest of online businesses.

NetChoice, a group supported by AOL, Yahoo, eBay, Oracle and other online companies, has published its iAWFUL(Internet Advocates' Watchlist for Ugly Laws) list of the top ten worst proposed laws affecting ecommerce and open communications.

The list, which includes mostly state legislation, attacks laws that the group believes "threaten to undermine the foundation of the free and open Internet."

The group's primary focus is on laws that will affect business,
particularly by increasing taxes or dictating standards and practices
that the group thinks are unworkable. NetChoice lays part of the blame
for the new wave legislation on the states' need for new revenue in the
midst of a downturn, and also on the legislators' unfamiliarity with
the internet itself.

Quoted by SiliconValley.com, Steve DelBianco, executive
director of NetChoice, says that "[s]tates are hurting and looking
for taxes from anywhere they can. We're also seeing more business online, and a
disruptive technology that kids understand better than many
legislators, so it's a perfect storm."

So
far, the group has already secured changes to one of the laws on its
list, California Social Networking Bill (AB 632). The bill would have
required social networks to block the copying of images in order to
protect young kids. NetChoice lobbied hard in opposition, and the most recent version of the bill swaps the restriction for a simple requirement to warn users on the
site that their pictures might be copied. The bill is currently before
the state Senate, and NetChoice is considering whether to withdraw its opposition.

Here are the the top 5 laws included in the iAWFUL list:

New Jersey Social Networking Bill (A 3757). It requires social networking websites to promptly review user
allegations of harassment and abusive language, and to provide a report
of the result of any review "upon request" from the user.

California Social Networking Bill (AB 632). This bill was recently amended to require social networking websites to
disclose to its users that uploaded photos can be copied without
consent by persons who view the image. The definition of a "social
networking Internet Web site" is broad, so this would apply to a large
number of sites on the Internet. In its previous form, this bill would
have placed affirmative requirements on social networking websites to:
(1) prevent a user from copying or reproducing an image that appears on
the social networking website without the permission of the user who
posted the image and (2) establish a mechanism for a person to flag an
image for removal from the social networking website.

Connecticut Tax Bill (SB 806). This bill would create nexus for sales tax purposes over any person who
enters an agreement with a resident that pays any consideration or
commission for referring potential customers to the retailer.
Connecticut business that depend on Internet ad revenue better watch
out--the money will dry out if this passes.

North Carolina Tickets Bill (SB 99). SB 99 violates federal law because it explicitly targets Internet--and
only Internet--ticket sales. The Internet Tax Freedom Act Amendment Acts
of 2007 (Public Law No: 110-108) provides a moratorium through November
1, 2014 on any "multiple or discriminatory taxes on electronic
commerce." This law bars federal, state and local governments from
imposing discriminatory Internet-only taxes such as bit taxes,
bandwidth taxes, and email taxes. It also prohibits the sort of prima facie discrimination exhibited by SB 99--"Reselling or offering to resell admission tickets on the Internet...").

Connecticut Internet Resellers Amendment (SB 1002). An amendment to SB 1002 requires Internet sellers to maintain an
elaborate record-keeping system (in English, by the way) whenever they
purchase and resell goods obtained from someone who is "not regularly
engaged in the business of dealing in such goods." The bill requires
that the physical location of these records--often someone's own
house--to be open to the public for inspection!